I don't blame Kerori for trying to win. Sure, she's risking Royal One, but a competition is a competition. They didn't give an explanation of how rank-ups are awarded anyway, so there's no reason to believe that every member of the abnormal class could get a rank-up in the first place. Maybe if they all collaborated at the beginning to split up points evenly, but instead, they all decided they'd compete to show whose training is hardest. Besides, if being a demon means uninhibiting your desires, then demons are just being demons. It would have been interesting if something pushed her over the edge and it turned out that this was her wicked phase, especially if it meant she got a different design for her wicked phase.
That said, I think it's kind of unfair that attacking other students will get you disqualified, but siccing your beasts on them won't. Maybe the beasts are just attacking the castle and raiding the ingredients, but that seems unlikely.